Franco-Nevada Corporation · TSX:FNV
Franco-Nevada — Investor Presentation (May 2023)
35 slides from Franco-Nevada's investor presentation, May 2023
Slide 1: Corporate Presentation May 2023
Corporate Presentation MAY 2023 FNV: TSX | NYSE
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT 2 Forward Looking Statements This presentation contains “forward looking information” and “forward looking statements” within the meaning of applicable Canadian securities laws and the United States Private Securities Litigation Reform Act of 1995, respectively, which may includ
Slide 3: The Gold Investment That Works
THE GOLD INVESTMENT THAT WORKS 3 Franco-Nevada is the leading gold-focused royalty and streaming company with the largest and most diversified portfolio of cash flow producing assets. Leading Low-risk Diversified Growth track record business model portfolio and optionality
Slide 4: Shareholder Returns: Leading Track Record
SHAREHOLDER RETURNS 4 Leading Track Record (CAGR Since FNV Inception 1, 2, 3) A lower-risk gold investment to Franco-Nevada (FNV) - US$ basis hedge against market volatility NASDAQ NYSE and TSX listed S&P 500 Large holders include: Gold Bullion ETF BlackRock Barclays US Aggregate Bond Fidelity
Slide 5: Partnership Success: Industry-Leading Operators
PARTNERSHIP SUCCESS 5 Royalty and stream financing that provides Industry-Leading Operators long-term alignment and financial flexibility. Lundin Mining: Candelaria Acquisition Detour Lake: A Partnership Success Story
Slide 6: ESG Leadership
ESG LEADERSHIP 6 Our ESG Focus ESG Ratings & Recognition Responsible Capital Allocation Community Contributions Good Governance & Shareholder Alignment Diversity, Inclusion & Well-Being Climate Action Transparent ESG Disclosure The use by Franco-Nevada Corporation of any MSCI ESG Research LLC or its
Slide 7: Business Model
Business Model
Slide 8: Business Model Advantages
BUSINESS MODEL ADVANTAGES 8 Optionality Potential for exploration success on approximately 66,000 km2 Focus on Growth Management not occupied with operational decisions Diversified Portfolio Non-operating business is more scalable Free Cash Flow Business Not exposed to capital calls Limited Cost Inf
Slide 9: Financing Successful Mines
FINANCING SUCCESSFUL MINES 9 Partnership Approach Alignment with partners for M&A Debt Reduction a win-win solution Support leading operators through long-term Project Development Emerging Projects partnership Technical team with strong track record identifying successful projects
Slide 10: Why We Are Different
WHY WE ARE DIFFERENT 10 Shareholder Financial Cyclical Asset Alignment Flexibility Investing Selection Committed to high share Avoiding long-term debt Board and management Strong technical skills ownership and low and paying progressive have a patient approach and a focus on G&A – treating and susta
Slide 11: Asset Portfolio
Asset Portfolio
Slide 12: Assets
12 421 Assets Covering Approximately 66,000 km2 Our Portfolio 421 TOTAL 113 Precious Metals Diversified PRODUCING 45 Precious Metals Diversified ADVANCED 263 EXPLORATION Not all assets shown on map, including exploration assets Asset count as of April 30, 2023
Slide 13: Core Precious Metal Streams Outperforming
13 CORE PRECIOUS METAL STREAMS OUTPERFORMING Antamina Cobre Panama $610M investment $1.36B investment 2022 revenue: $68M 2022 revenue: $223M Mine life potential1: 30+ years Mine life potential1: 35+ years Payback2: 75% Payback2: 42% Silver production has exceeded Expanding to 100 Mtpa in 20234 expec
Slide 14: Long-Life Assets
LONG-LIFE ASSETS 14 Franco-Nevada Growing reserves and reserve lives Sr. Gold Producers Long-duration portfolio increases optionality Int. Gold Producers 0 Years 2 4 6 8 10 12 14 16 18 2017 2022 Source: Bank of America/Merrill Lynch (May 2023) Calculations as at December 31, 2022 Seniors: Agnico Eag
Slide 15: Revenue Diversification
REVENUE DIVERSIFICATION 15 Diversified with Low Risk (Q1 2023 Revenue) Rest of Gas First World 6% Cobre Panama Quantum Oil 11% 20% 20% 10% Canada NGL Other & USA 30% 1% Other Mining 34% Mexico & 6% Others Central Candelaria 45% PGM 4% Commodity America 26% Geography Assets 10% Operator Lundin 10% Si
Slide 16: Royalty Optionality
ROYALTY OPTIONALITY 16 2007 2008 - 2022 2022 120 100 >45 Moz gold Mineral Reserves (Moz) >$2.1B3 produced Proven & Probable 80 revenue to FNV 60 from portfolio >3.5x Gold increase1 40 Reserves2 of same assets Gold as reported 20 Reserves2 Dec. 2022 at time of IPO - IPO Reserves $1.2B paid for increa
Slide 17: Increasing Profitability
INCREASING PROFITABILITY 17 2022 84% 2021 Adjusted EBITDA Margin1 2020 2019 53% 2018 Adjusted Net Income Margin1 2017 - 200 400 600 800 1,000 1,200 1,400 US $ (Millions) G&A Cost of Sales Depletion Taxes/Other Adjusted Net Income 1. Please see notes on appendix slides – GEOs and Non-GAAP Measures 2.
Slide 18: Track Record
Franco) Nevada
Slide 19: Track Record
TRACK RECORD 19 GEOs1 Revenue Adjusted EBITDA3 (000’s) (US$ Millions) (US$ Millions) 800 1,400 1,200 700 1,200 1,000 600 1,000 800 500 800 400 600 600 300 400 200 400 200 200 100 - - - '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 '08 '09 '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21
Slide 20: Progressive & Sustainable Dividends
PROGRESSIVE & SUSTAINABLE DIVIDENDS 20 16 Consecutive Increases Quarterly Dividend US$0.34/share4 Increased to US$0.34 per $260 $240 $1,950 $1,800 Share as of Q1 2023 Dividends Paid US $ (Millions) per annum $220 $1,650 Dividend Payment $200 $180 $1,500 $1,350 Gold Price US $ $160 $1,200 >$1.98B pai
Slide 21: Outperforming Bull & Bear Markets
OUTPERFORMING BULL & BEAR MARKETS 21 40% 32% 19% 20% 14% 14% 9% 1% – (6%) (14%) (20%) (33%) (40%) Bull Market Bear Market Bull Market (2008 - 2012) (2013 - 2015) (2016 - Present) Franco-Nevada (US$) Gold GDX1 1. GDX is a Gold Equity index comprised mostly of gold operating companies 2. Source: TD Se
Slide 22: Growth Outlook
Growth Outlook
Slide 23: Guidance
GUIDANCE 23 2022 Actual 2023 Guidance1 2027 Outlook2 729,960 640,000-700,000 760,000-820,000 GEOs Total + Record GEOs in 2022 – Assumes lower oil and gas prices1 Assumes flat commodity prices1 + Diversified guidance exceeded + Vale royalty attributable production + Growth from Precious Metal assets
Slide 24: Cobre Panama Growth Outlook
COBRE PANAMA GROWTH OUTLOOK 24 GEO Growth Profile On track to achieve 100Mtpa by the end of 20231 First Quantum maintains guidance of 350,000- 380,000 tonnes of copper for 2023 FNV 2023 guidance of 115,000-135,000 GEOs 1. First Quantum Minerals Ltd. and the Government of Panama agreed 20202 20212 20
Slide 25: Organic Growth Pipeline
ORGANIC GROWTH PIPELINE 25 2023 2024 2025 2026 2027 Expansions1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Cobre Panama2 Panama Subika Ghana Tasiast Mauritania Vale Brazil Detour Lake Ontario Kirkland Lake Ontario Island Gold Ontario Stillwater Montana New Mines Est. Start3 Q2 Q3 Q4 Q1
Slide 26: Producing Asset News
PRODUCING ASSET NEWS 26 Streams Draft concession contract agreed in March with the government which is still subject to parliamentary Cobre Panama Panama ratification. Throughput returned to full capacity on March 10, 2023. Candelaria Chile Updated Technical Report provided February 22, 2023. Potent
Slide 27: Advanced and Exploration News
ADVANCED AND EXPLORATION NEWS 27 Construction Updates Salares Norte Chile Construction nearing completion. First production expected end of Q4 2023. Magino Ontario Construction 80% complete. First production expected H1 2023. Séguéla Côte d’Ivoire Construction 96% complete. First production expected
Slide 28: Long-Term Optionality
LONG-TERM OPTIONALITY 28 Long-Term Assets 3.4Moz of total 18.8Moz M&I Holt Complex Royalty Ounces1 are from (Au) Other Cascabel long-term assets that are not (Cu, Au, Ag) Pandora included in 5-year outlook2 Expansion (PGM) Ring of Fire 3.4 Moz Exposure to large gold, (Cr, Ni) copper and nickel depos
Slide 29: Available Capital
AVAILABLE CAPITAL 29 NUEVAUNIÓN (RELINCHO) 1. As at March 31, 2023 2. $1B Corporate Revolver 3. Funding commitments subsequent to March 31, 2023 will be funded with cash flow from operations
Slide 30: Board and Management
BOARD AND MANAGEMENT 30 Board Management David Harquail Paul Brink Tom Albanese Derek Evans Dr. Catharine Farrow Paul Brink Sandip Rana Lloyd Hong Chair of the Board President & CEO Former CEO CEO Former CEO President & CEO CFO CLO Rio Tinto MEG Energy TMAC Resources Board Director Maureen Jensen Je
Slide 31: Thank You For Your Interest
THANK YOU FOR YOUR INTEREST IN www.FRANCO-NEVADA.com TSX: FNV | NYSE: FNV
Slide 32: Appendix – GEOs and Non-GAAP Measures
APPENDIX – GEOS AND NON-GAAP MEASURES 32 1. GEOs include Franco-Nevada’s attributable share of production from our Mining and Energy assets, after applicable recovery and payability factors. GEOs are estimated on a gross basis for NSR royalties and, in the case of stream ounces, before the payment o
Slide 33: ESG Leadership
ESG LEADERSHIP 33 Responsible Good Governance & Community Contributions Capital Allocation Shareholder Alignment We are committed to allocating capital to responsible We are committed to contributing to our communities We are committed to responsible governance practices operators that provide safe
Slide 34: ESG Leadership
ESG LEADERSHIP 34 Fostering Diversity, Transparent Inclusion & Well-Being Climate Action ESG Disclosure We are committed to maintaining a safe and We have a goal to achieve net-zero GHG emissions by supportive environment for our team members and 2050 with respect to our corporate operations and are
Slide 35: CRA Audit (2012-2019)
CRA AUDIT (2012-2019) 35 On April 28, 2023, Franco-Nevada reached a settlement with the CRA with respect to the domestic reassessments (2014-2017) and Foreign Accrual Property Income reassessments (2012-2013), with such reassessments to be vacated entirely. The potential tax exposure related to thes